US Dollar as the Global Reserve Currency

Bitcoin Has no Serious Potential to Replace (or Supplement) the US Dollar as the Global Reserve Currency
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The Bitcoin is a decentralized virtual currency that is used as a medium of exchange through online platforms since there is no central bank that oversees the control of the digital currency. Its value fluctuates often since it is based on what people think is the true value. Increased adoption of Bitcoin is likely to garner interest if online merchants adopt the currency. However, bitcoins are unlikely to replace fiat currency since it is merely an adapted tool (Greeley, 2013). It is not as though fiat currency has fallen out of favor, but there has been interest to have another major Global Reserve Currency, since the dollar gives the U.S too much power in the international market. This essay disagrees with the notion that the Bitcoin has serious potential to replace/ supplement the US dollar as the Global Reserve Currency
Bitcoin is unlikely to dislodge the dollar as the Global Reserve Currency, given the advantage of the dollar as a fiat currency that is typically backed by assets. This makes the US dollar reliable in international trade transactions compared to the Bitcoin which is merely backed by circulation and ‘mining’ activities. Reliance on only the demand and supply forces common in the Bitcoin creates uncertainty unlike the dollar which relies on underlying assets including gold to change in value. Bitcoin is scarce meaning that even for those who deal with the virtual currency getting hold of it, masks the currency’s weaknesses for it is not convenient to carry out day to day activities. Hypothetically, if people adopted the Bitcoin then there would be need for increased internet connection in the US and the global markets for transactions to be completed.
On one hand, the decentralization of the Bitcoin means that the owners have the discretion to control their finances compared to the dollar. This is because each person has their unique encryption keys. On the other hand, there are security threats with this as there is no reliable way to determine the identity of dealers. The US dollar is the preferred currency in international trade and currency flows can easily be monitored form one country to another, in other words, the dollar is a Global Reserve Currency that is traceable and chosen over many other major world currencies even when Bitcoin payments tend to be faster.
The dollar is one of the main currencies in the world, and the Euro has not been able to dislodge the currency from being the Global Resave Currency. For any currency to be worthwhile and accpted there is an element of trust and adoption. The regulatory authorities including the Major Central Banks treat the virtual currency with caution given that people are not used to the currency. The Bitcoin has a barrier to entry since it is technology-based unlike the fiat system which has long dominated the world. As such, the Bitcoin remains valuable for some online payments and gaming but cannot be relied upon in international trade as the Global Reserve Currency.
The Bitcoin can also not be a safe haven currency given that it is a store of value and, measure of value but not a ...